Excerpts from the notes I’ve seen. More as they come in.
Timothy Arcuri, UBS: Management changes highlight transition. Apple announced two major executive changes with Chief Design Officer Sir Jony Ive leaving the company later this year and Sabih Khan, a 24-year veteran of the company, being appointed as senior vice president of operations. Jony Ive has obviously been the heart and soul of Apple’s product design, but he will also continue to work with the company in his new venture. His departure certainly highlights the pivot in the narrative toward services, though product development remains important for Apple with an iPhone form factor change critical to drive future upgrades. His departure creates some risk but at the same time, the product design group is very deep and talented, in our view. It is early to speculate CEO succession plans with the appointment of Sabih Khan but we note Tim Cook did hold the chief operations role prior to becoming the CEO. Buy. $225.
Krish Sankar, Cowan: End of Another Chapter. We view Sir Ive’s departure as disadvantageous for the company. But AAPL is undertaking a transition from being focused on hardware products to services and content. While it remains unclear how Apple’s future hardware product innovation may be impacted without Ive, the multiple stakeholders that will be tasked with design decisions going forward will undoubtedly open a new chapter in Apple’s design language. Sir Ive will continue to work with Apple on exclusive projects in his new proprietorship. Outperform, $220.
Amit Daryanani, Evercore ISI: Thinking Through Design Chief Departure. While we think this development is perceived as a negative (stock traded down -1% during after-hours trading), we think any potential impact from Mr. Ive’s departure should be manageable given: 1) Mr. Ive is leaving to start his own independent design company, of which AAPL will be a key client and 2) Apple’s design team leaders Evans Hankey (VP of Industrial Design) and Alan Dye (VP of Human Interface Design) will remain in their leadership roles with the company while Apple’s Chief Operating Officer, Jeff Williams, will also expand his role with the design team. (emphasis his). Outperform. $215.
Daniel Ives, Wedbush: Chief Design Officer Jony Ive Departing Cupertino. Our initial take is this move by Ive is a “surprise to the Street” as it is a major changing of the guard within Cupertino. Ive is leaving a hole in the company and is clearly irreplaceable… While this is a bit if a shocker to Apple and its investors we are not overly concerned as Ive will continue to work closely with Cook & Co. We continue to believe the risk/reward in Apple’s shares is compelling at current levels. Outperform. $215.
Andrew Murphy, Loup Ventures: Jony Ive’s Legacy Is Apple’s Core Competency. In our view, Ive transitioned away from direct product design in 2015 when he shifted his focus to the architecture of Apple Park. At that point, and ever since, the design team has been functioning independent of his day-to-day management. While we are puzzled by the design team leadership structure announced today with Evans Hankey, Alan Dye, and Jeff Williams sharing those responsibilities, we expect it to be temporary. Apple’s core competency of design is unmatched and from its culture of design-first thinking, the right leader will emerge in time. Thanks to Jony Ive.
Neil Cybart, Above Avalon: These are shocking developments. Interestingly, Jony Ive’s departure ends up being just one of the interesting announcements. I already have a number of initial thoughts on these changes and this situation does look quite complicated. While his employment status will change, I’m not convinced Jony is truly “done” with Apple. However, I do want to take the time to expand on some thoughts before publishing.
John Gruber, Daring Fireball: Jony Ive is leaving Apple. This may be good news. Ive is, to state the obvious, preternaturally talented. But in the post-Jobs era, with all of Apple design, hardware and software, under his control, we’ve seen the software design decline and the hardware go wonky. I don’t know the inside the story, but it certainly seems like a good bet that MacBook keyboard fiasco we’re still in the midst of is the direct result of Jony Ive’s obsession with device thinness and minimalism. Today’s MacBooks are worse computers but more beautiful devices than the ones they replaced. Is that directly attributable to Jony Ive? With these keyboards in particular, I believe the answer is yes.
Horace Dediu, Asymco: The Essence of Apple’s Decision. When hearing about big staff changes at Apple, take a moment to reflect what decision processes are at work. How did that one (visible) Actor really influence the decisions made? Are you ascribing too much to them because they are visible? Are you assuming that tens of thousands of other individuals are not influential? That they are minions hired to act and not to ask questions? Doesn’t Apple also say they hire people to tell Apple what to do?
Dieter Bohn, The Verge: Apple and the end of the genius. The era of the singular genius at Apple is over. Committees are a pain, they’re not as mythic as a singular genius, they’re often more timid than they should be. But maybe what Apple design needs right now is a little less mythos and a little more compromise.
Ben Bajarin, Techpinions: A Fresh Start. I know this is hard for many to comprehend at the moment but if Apple is to go on for another 100 years or more, their key execs who helped make Apple what is today will not be around forever. I’ve always tried to explain how Apple has a culture, and an ethos, that has to be preserved. If Apple the company was Steve Jobs most important product as many argue, then it is essential that product stays true to itself even in the years when senior leadership transitions the company to new leaders. Ultimately, this is true for Apple, and it was unfortunately prematurely tested with Steve Jobs passing. Jony’s departure and the transition will be the second test for Apple.
Ben Thompson, Stratechery: Even Ive’s exit was beautifully designed. In my estimation the best way to think about the last four years of Ive’s tenure is investor management. The “Apple is doomed” narrative goes in cycles, and was definitely at one of its peaks in mid-2014; there was tremendous pressure on Tim Cook in particular to launch a new product line and demonstrate that Apple could innovate without Steve Jobs. The Apple Watch was that product (although it turned out that the real breakthrough for Apple, at least from an investor perspective, was the large-screened iPhone 6 that launched the same day). Ive was very deeply involved in the Watch, which made its release — the culmination of years of work — the right time to step back internally, but it took a few years for Apple to fully transition to the post-iPhone era from an investor perspective. Frankly, there is no better time for this announcement than right now, which is to say, even Ive’s exit was beautifully designed.
Benedict Evans, a16z: Benedict’s Newsletter. This is the end of the band – Jobs decided what do to, Ive made it great and Cook made it happen (this is probably unfair to all three of them) and now only Cook is left, and it’s not clear how the creative process is going to work. Industrial design now reports, not to the CEO, but to operations, and Marc Newson (the other rock star Ive hired) is leaving as well, so how does Apple avoid being a very efficient but slightly normal company? This is an untestable question – come back in 10 years, project this email onto your retina with your Apple Lens, and see what you think.
M.G. Siegler, 500 Words: The Knight of Apple’s Old Republic. Many people have been pointing out that Apple seems to be positioning Williams, who again, is COO right now, to eventually be Cook’s replacement as CEO. But I think it’s even simpler than that in the short term: they’re trying to position Williams as the new product guy.⁴ He saved the Apple Watch, let’s see what else he can do with more purview on the product side, seems to be the thinking. And that’s why I don’t think it’s as crazy as it may seem at first to have the new design leads report to him. Apple is not going to run the same way as it did under Jobs, that has been well establish for almost a decade now. But it’s also not going to run the same way that it has with Jony Ive in the fold.
Macalope, Macworld: Ive got a story to tell. It is amusing to see Ive tarred as being a single-minded anti-environmental terrorist and, at the same time, someone who was barely showing up for work. Sometimes The Macalope wishes these people would agree on one story but that’d be like asking squirrels to take up synchronized swimming.
Apple’s press release.
Rene Ritchie’s first take:
Rene Ritchie and John Gruber together (transcript here):
UPDATE: Friend-of-the-blog Victor Castroll called to remind me that he knew this was coming and dropped a broad hint in the comment stream a couple months ago. Link.